From 23 to 27 May, the Ghanaian capital Accra hosted the 57th annual meetings of the African Development Bank (AfDB) under the theme “Achieving Climate Resilience and a Just Energy Transition for Africa.” reports Doaa A. Moneim from Accra.
During the meetings African country representatives as well as AfDB officials emphasised that the UN COP27 conference on climate change to be hosted by Egypt in November is a great opportunity to showcase Africa’s potential and explore ways to unlock it in the fight against climate change.
They urged the international community to fulfil the commitments it made at last year’s COP26 meeting to allocate $100 billion to the developing countries, including in Africa, to adapt to the dangers of climate change.
Africa loses between $7 and $15 billion per year because of climate change, and this toll is projected to jump to $40 billion annually by 2030, according to President of the AfDB Group Akinwumi Adesina.
“Africa has no choice but to adapt to climate change. Climate change is killing the African economies, while the continent is responsible for only four per cent of global greenhouse-gas emissions,” he said.
The AfDB has doubled its financing to mitigate the effects of climate change by 2025 to $25 billion.
Adesina told Al-Ahram Weekly he believes COP27 will help voice Africa’s potential and challenges and the importance of securing finance from international institutions to help the continent address climate change and its associated impacts.
Delegates participating in the meetings announced their adoption of the Accra Declaration, which captures decisions taken by AfDB governors. It positions the AfDB to play a key role in leveraging and providing finance for climate adaptation on the continent, while also addressing the looming food crisis and supporting the green and clean energy transition.
To address financing issues amid the ongoing challenges, the delegates reaffirmed their commitment to strengthening the AfDB’s financial resources to enable a scaling-up that will multiply and raise the level of achievement in the countries of its operation.
The bank highlighted its willingness to be a vehicle for the continent’s International Monetary Fund (IMF) Special Drawing Rights (SDRs) reallocations in Africa. There were calls last year for developed and developing economies to channel SDRs through multilateral development banks like the AfDB.
SDRs are an international reserve asset — not a currency — through which the IMF supplements member countries’ official reserves. Currently, the IMF’s Poverty Reduction and Growth Trust Resilience and Sustainability Trust are the sole channels for SDR reallocation.
During the Accra meetings, UK Minister for Africa, Latin America and the Caribbean Vicky Ford said the UK might channel some of its IMF SDRs to Africa through the AfDB.
Adesina believes the institution’s track record should be a strong argument in its favour as it is the only African institution that has a credit rating of AAA from the international agency Moody’s and is ranked fourth on the global transparency index.
He said that independent reviews had showed the bank’s governance instruments were up to international standards.
“With the African Development Fund we have created a powerful institution, the only one based in Africa that exclusively finances Africa’s development,” Adesina said. The AfDB meetings this year coincide with the 50th anniversary of the fund, which was established to give concessional loans to member countries to help them curb poverty.
As for the AfDB’s action plan to contain food disruptions in Africa on the back of the war in Ukraine, in collaboration with the African Union Commission it has approved the Africa Emergency Food Production Plan with a total value of $1.5 billion dedicated to supporting the African countries in producing food rapidly.
The plan is projected to produce 38 million metric tons of food, including wheat, maize, rice, and soybeans to a total value of $12 billion.
“Our $1.5 billion investment will deliver $12 billion, a leverage factor of eight times. The plan will deliver climate-resilient agricultural technologies to 20 million farmers” across the continent, Adesina explained.
The plan follows a global convening by the bank, in partnership with the African Union Commission, of African ministers of finance, economy, and agriculture, and representatives of African development finance institutions, UN agencies, and developed countries around the world, along with the IMF’s managing director.
“We all agreed it is time to support Africa to produce its own food. It is time to have food sovereignty. Food aid cannot feed Africa,” Adesina said.
The AfDB also launched its Circular Economy Facility (ACEF) at the Accra meetings to a total value of €4 billion in collaboration with the Finnish government, with the aim of helping all African countries adapt to climate change based on two key pillars, building institutional capacity and supporting the private sector, especially small and medium-sized enterprises (SMEs).
There will also be expanded membership of the African Circular Economy Alliance (ACEA) launched to stimulate the African countries’ transition to a circular economy model that provides economic growth, jobs, and positive environmental outcomes. To date, only Ghana, Cote d’Ivoire, Nigeria, Rwanda and South Africa are members of the Alliance.
Speaking to the Weekly, AfDB vice-president for climate action Kariuki Kevin Kanina explained that the initiative would help all the African countries including Egypt to a full implementation of the circular economy and would contribute to adapting to climate change, dealing with the food crisis, and unlocking the continent’s production potential.
Finnish Minister of Foreign Affairs Juha Savolainen told the Weekly that Finland is the first country globally to adopt a circular economy roadmap that brings together all parts of the economy in a multi-stakeholder collaboration.
“We started its implementation in 2016 with a roadmap over 13 years. So far, it has managed to generate €2 billion and is expected to add a further €3 billion through 2030. This shows how such a model can benefit the African countries,” Savolainen explained.
At the Accra meetings, the AfDB governors emphasised the continued relevance of the Bank’s “High 5 Priorities” agenda, which involves Light up and Power Africa, Feed Africa, Integrate Africa, Industrialise Africa, and Improve the Quality of Life of the People of Africa as essential cornerstones of its strategic outlook for the next 10 years (2023-2032).
It targets building “a prosperous Africa based on inclusive growth and sustainable development,” they said.
The AfDB named Egypt as the host of the bank’s annual meetings in 2023, scheduled to be held from 22 to 26 May next year in Sharm El-Sheikh. Egypt is an AfDB country member and its second largest shareholder.
*A version of this article appears in print in the 2 June, 2022 edition of Al-Ahram Weekly.